Cumulative evidence suggests that allosteric activation of the NMDA receptor through the glycine modulatory site provides new therapeutic potential for the treatment of schizophrenia. D-Serine, an endogenous agonist at the glycine modulatory site, has been shown to be effective at treating positive, negative, and cognitive symptoms of schizophrenia in clinical studies. Despite the highly encouraging clinical data, clinical development of D-serine will likely face obstacles because of the high dosages required for efficacy (approximately 2 grams per day). This is primarily due to the substantial metabolism of peripherally administered D-serine by D-amino acid oxidase (DAAO), a flavoenzyme expressed in the liver, kidneys, and brain. DAAO-mediated metabolism of D-serine not only limits D-serine bioavailability but also has the potential to induce kidney toxicity through the generation of hydrogen peroxide. Therefore, we hypothesize that blockade of DAAO-mediated D-serine metabolism could substantially lower the dosages required for efficacy while preventing hydrogen peroxide-induced peripheral toxicity. To this end, we found that co-administration of D-serine and a DAAO inhibitor significantly increases plasma and brain levels of D-serine and enhances in vivo potency of D-serine in an animal model of schizophrenia. The goal of the proposed research is to translate our findings into innovative therapeutics by conducting a strategic research plan that consists of the following: (Aim 1) Perform lead optimization studies on benzoisoxazole derivatives and other classes of fused bicyclic compounds to establish SAR (structure-activity relationships) and identify potent, selective, non-toxic, and metabolically stable drug-like DAAO inhibitors; (Aim 2) Assess the effects on D-serine oral bioavailability of potent drug-like DAAO inhibitors identified in Aim 1; (Aim 3) Assess the effect of DAAO inhibitors identified in Aim 2 on D-serine's ability to attenuate phencyclidine (PCP) induced prepulse inhibition (PPI) deficits in mice; (Aim 4) Assess the effects of DAAO inhibitors identified in Aim 3 on D-serine's ability to attenuate PPI deficits in a genetic mouse model of schizophrenia. Upon completion of this project, we expect to identify preclinical candidate DAAO inhibitors that could lead to a truly novel antipsychotic drug for the treatment of schizophrenia.